Burnside Bridgehead on verge of first project

Jonathan Malsin, director of operations at Beam Development, stands in front of the Convention Plaza Building. Beam and the Portland Development Commission are creating a Disposition and Development Agreement that would allow Beam to purchase the building and develop it. (Photo by Dan Carter/DJC)

After other developers said to knock it down, one Portland development company plans to reuse a historic building and spark the long-stalled Burnside Bridgehead project.

The Convention Plaza Building, at 123 N.E. Third Ave., is the subject of a Disposition and Development Agreement between the Portland Development Commission and Beam Development. The building would be the first project to move forward in the five-block redevelopment area in Portland’s central eastside.

“We are still early in the process, but this DDA is really the initiation of phase one,” said Geraldene Moyle, senior project manager with the PDC. “Both Beam and the PDC believe Convention Plaza is ideally suited to be the catalytic project for the Burnside Bridgehead development.”

Beam’s contract with the PDC for providing strategic advice during the Burnside Bridgehead framework process included a clause that gave the company exclusive rights to develop at least 20 percent of the entire project. After deciding during the framework process that the Convention Plaza building should not be demolished, Beam targeted the 97,000-square-foot building for its portion. The Convention Plaza building and the adjacent parking lot, known as Block 68, would account for the 20 percent allotted to Beam.

“Everyone who’s looked at the Burnside Bridgehead project before us has suggested demolishing it,” said Jonathan Malsin, director of operations at Beam. “So the first thing we did in the framework process was a reuse analysis, because we wanted to see if this thing was worth restoring.

“In evaluating our options, and understanding the current state of financing, we saw potential and really didn’t want to get rid of it.”

Beam’s early plan for the building, which was constructed as a warehouse in 1924, is to house office space for creative industries, according to firm principal Brad Malsin. Ideal businesses, he said, would be involved in clean technology, software design or architecture.

“We have a waiting market for our other buildings on the eastside, so this could help accommodate those needs,” he said. The Olympic Mills Commerce Center is 98 percent occupied, while the Water Avenue and Eastbank commerce centers are both fully occupied. All three are listed on the National Register of Historic Places, and Beam plans to pursue the same designation for the Convention Plaza building.

This photo, taken during the Flood of 1964, shows the Convention Plaza building when it was used as a warehouse for Sears. (Photo courtesy of ODOT)

“We really like rehabilitating buildings because it gives the space more character and a more authentic feel,” Jonathan Malsin said. These types of spaces are ideal for businesses in the creative industry, but also businesses in Portland as a whole, he said.

Brad Malsin added that the building’s exterior would be restored to its original look, but the interior would have a more contemporary feel.

Beam is presently studying the building’s structural, mechanical and historical characteristics. The developer would prefer to avoid performing any seismic work on the building, but it has planned for the possibility.

“Depending on the route we decide to take with occupancy, parking and the ground-level spaces, there is a chance that some seismic work might have to be done,” Jonathan Malsin said. The firm has concluded that any necessary seismic work could be performed without damaging the building, he added.

Depending on the structural work that needs to be done, and what comes out of the DDA, Jonathan Malsin said the project could have financing secured and be ready for construction as early as the end of the year.

Through the DDA, Beam will purchase the building – appraised in 2003 at $8 million – from the PDC. Beam will look to supplement private financing with historic tax credits and new market tax credits.

Though exclusive negotiations of the DDA call for Beam to develop the Convention Plaza building, Moyle said, the rest of the developable blocks within the Burnside Bridgehead properties are fair game, she said.

The PDC on Wednesday issued a request for information from firms interested in working on any of the other developable blocks. These include portions of blocks 67, 68, 69, 75 and 76.

“We view this DDA as a great sign for the Burnside Bridgehead and the entire central eastside,” Moyle said. “It’s really exciting that we are moving ahead with this long project even during the current economic conditions.”